I was interested to read on the Panorama news website that President Obama and the US Government have Gibraltar in their sights as a potential location for money laundering because it is a tax haven.
Britain’s Prime Minister, Gordon Brown, has already signalled that he is seeking international support to crack down on tax havens. This issue is due to be discussed at the G20 meeting to be held in London in April.
Panorama reports: “Gibraltar is listed in the US list of ‘secrecy jurisdictions’ and in the OECD list of tax havens, so we are bound to be in the spotlight.
“In the OECD list Gibraltar does not escape too badly, although the State Department gives us a ‘secondary’ rating when it comes to money laundering vulnerability.
“The US has legislation which President Obama wants to push through Congress. Gibraltar is on the list.”
The Organisation for Economic Cooperation and Development removed Gibraltar from its list of ‘uncooperative’ tax havens in 2002 after it promised greater openness in tax practices.
Gibraltar denies it is a tax haven, saying it complies with EU rules on regulation, transparency and exchange of information and that it will end its tax-free regime this year by introducing a 10 percent corporate tax rate. However, to date, that doesn’t seem to have impressed the US.
In a speech on Thursday to the Royal Commonwealth Society in London Gibraltar’s Chief Minister, Peter Caruana, said he welcomed Gordon Brown’s call for a global raising of regulatory standards for financial services and looked forward to participating in it.
However Caruana added: “But let us not use it as a means of getting people to believe that tax havens and offshore financial services centres are the cause of the global financial services crisis.
“Everybody knows where the cause is and it’s not in Jersey, it’s not in Guernsey, it’s not in the Isle of Man, it’s not in Switzerland, it’s not in Gibraltar.”
Indeed one wonders if the world’s political leaders are intent on putting the spotlight on the ‘tax havens’ in an effort to deflect attention from their own gross mismanagement of their economies, especially in the USA and Britain.